The Shanghai government says it will foot the bill for the failures of angel investors. Effective next month, angel investors who suffer losses from investing in Shanghai based hi-tech start-ups, will get 30 to 60 percent compensation from the government.
Shanghai says the move will help encourage entrepreneurship and boost innovation.
Analysts caution the rules may please the start-up losers, while leaving the successful ones unattended, adding that the government should also scrutinize those who scam the system.
